English Language Practice Cloze Test – Set 28

Mentor for Bank Exams
English Language Practice Cloze Test – Set 28
Directions (1 – 10): In the passage given below there are 10 blanks, each followed by a word given in bold. Each blank has four alternative words given in options A, B, C and D. You have to tell which word will best suit the respective blank. Mark E as your answer if the word given in bold after the blank is your answer i.e “No change required”.
Inflation has come down to its (1) surprising level in several years. The balance of payments situation is comfortable because stable capital flows are funding the current account deficit. Government finances have improved thanks to a commitment to fiscal good sense. The rupee is strengthening against the dollar despite intervention by the Reserve Bank of India. Foreign exchange reserves are increasing rapidly. Excess private sector debt casts a long shadow over this picture of economic stability. The banks are in a mess because many of the loans given out during the preceding credit (2) investment have gone sour. Private sector investment is very weak. Economic growth is too dependent on consumer spending.
This was India in 2002 - on the cusp of an unprecedented economic boom. It is also India in 2017. Indian economic growth took off a year after the mix of macroeconomic stability combined with balance-sheet stress. What is the (3) probabilities that India is once again at an inflexion point?
There are no easy answers, but it is a (4) validated question that is worth asking at a time when equity investors are pouring money into shares at valuations that do not seem justified by the immediate growth in corporate profits. The benchmark Sensex closed above the 32,000 mark for the first time on Thursday. Foreign portfolio investors continue to bet on India as one of the brightest spots in an otherwise glum global economy. Domestic investors have been eager participants in the party because of the rapid spread of systematic investment plans (5) floated by local mutual funds, though valuations right now are far richer than they were 15 years ago.
There are two important differences in the macro matrix between 2002 and 2017. First, the five-year economic boom that ended in 2008 was marked by a (6) meagre rise in capital spending by companies. Second, exports were an important driver of growth thanks to a vibrant global economy. In fact, a closer look at the components of economic growth during the two previous booms show that the Indian economy grows more rapidly than its trend rate only when private sector sector capital takes off and a strong global economy provides support through demand for Indian exports.
It is no secret that a corporate investment is in (7) effigy right now. New data for the centre for monitoring Indian economy shows that new project proposals in the June quarter were at their lowest level in three years. Gross capital formation by the private sector  has come down sharply over the past three years. The reasons are  (8) excess capacity in many industries, the fact that companies are using cash flows to repay debt and banks are not in a position to (9) borrow.
However, international organizations such as the World Bank, the Organisation for Economic Co-operation and Development, and the Economist Intelligence Unit are predicting a (10) turnaround in private sector capex from fiscal year 2019. In fact, the World Bank has said in its recent India Economic Update that it expects private investment to overtake private consumption as the main driver of economic growth.
a) lowest
b) slower
c) greatest
d) steep
e) No change required
a) squeeze
b) bubble
c) fairs
d) swap
e) No change required
a) likelihood
b) chances
c) logic
d) justification
e) No change required
a) provocative
b) ill-timed
c) simplistic
d) understandable
e) No change required
a) manage
b) creating
c) bought
d) steered
e) No change required
a) astounding
b) miniscule
c) excellent
d) splendid
e) No change required
a) peak
b) acme
c) bottoms
d) doldrums
e) No change required
a) great
b) most
c) much
d) full
e) No change required
a) captilised
b) divest
c) succumb
d) lend
e) No change required
a) recovery
b) jolt
c) reimburse
d) forge
e) No change required

Answers with Explanations:
1. A) The word 'surprising' is non-contexual with the given paragraph.The paragraph indicates that inflation is at its minimum for many years.
Also, the sentence requires a superlative here, hence 'lowest' is the perfect fit for the blank.

2. B) "Credit bubble" is an economic condition in which consumers build up so much consumer credit that they are unable to repay, a situation which can cause havoc in a country's financial system arises. A 'credit squeeze' is a sudden reduction in the general availability of loans or a sudden tightening of the conditions required to obtain a loan from banks. The situation described in the passage is of credit bubble.

3. A) 'Chances' and 'probabilities' are plural noun here, therefore they won't fit in the blank. 'Justification' is illogical here. 'Likelihood', which means probability or chance is the right answer.

4. A) 'Provocative' means causing a strong reaction, especially deliberately. The preceding part mentions that the quesked asked has no easy answers, hence the purpose of the question is to provoke here. 'Simplistic and 'understandable' are not appropriate here.

5. E) If a company director floats their company, they start to sell shares in it to the public. The original word in the sentence 'floated' means to offer the shares of a company for sale on the stock market for the first time. The use of word 'floated' here relates to the same and is therefore appropriate.

6. D) The context of this part of the passage is of positive meaning, since it is relating to the good times prior-2008 period. 'Meagre' which means 'lacking in quantity or quality' is absolutely opposite in the context.
The words 'astounding', 'excellent'  will all fit the blank, but they will be rejected because of the presence of the article 'a' before the word.
'Splendid' which means excellent or very good is the best choice among all.

7. D) An effigy is a statue or carving of a famous person. Therefore, it is absurd here. 'Doldrums' means a state or period of stagnation or depression. This is the right word since it relates to the corporate investment, which is in a bad shape since new project proposals are at the lowest.

8. E) The original word 'excess' is right, since excess capacity means that the resources are not being fully used, and this is a bad sign for the economy. Therefore 'excess' is the correct answer. Other options are clearly inappropriate here.

9. D) In the whole passage, there has not been discussed a single situation which can work in the benefit of the banks, hence option A cannot be true. "Succumb will be illogical here as according to it the entire economy will fall down, which is neither the context here and is not true. 'Borrow' is just opposite to the context and for 'divest' to be correct, there has to be something which would give an answer to divest something which is absent here.

10. E) The presence of 'however' in the starting of the paragraph indicates that the situation is in the favor of private sector. 'Turnaround' is an abrupt or unexpected change, especially one that results in a more favourable situation. Therefore 'turnaround' is the correct answer.